Steps to reproduce:
1. Create a new Single View iOS application in Xamarin Studio
2. Right click on project, and click "Add > Add Web Reference"
3. Point to an asmx service (using the pre-filled Temp Convert web service is fine)
4. Select ".Net 2.0 Web Services" for the Framework, leave everything else as is
5. Click "OK"
The project will be updated, and there are references to a .disco and .wsdl file, but the relative path in the .csproj file is incorrect. User has to manually re-add those files (either by editing the csproj file, or by removing/adding the files from the project in the IDE).
Here is the actual folder path (when using the Temp Convert web service)
However, the csproj file has references to:
<None Include="..\..\..\..\..\..\..\..\TempConvert.disco" />
<None Include="..\..\..\..\..\..\..\..\TempConvert.wsdl" />
This is due to a bug #38108 in Mono 4.2 where it puts in the wrong path into the Reference.map generated when adding the web reference. The filename in the reference.map's file starts with a / so Xamarin Studio resolves to that file and ends up including all those ..\..\ since it believes the file is all the way back in the root directory.
The current workaround is to downgrade to Mono 4.0 where this problem does not occur.
*** This bug has been marked as a duplicate of bug 36116 ***